Item 1.01
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Entry into a Material Definitive Agreement.
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On July 27, 2016, Nexstar Escrow
Corporation (the Escrow Issuer), a wholly owned subsidiary of Nexstar Broadcasting Group, Inc. (the Company), completed the issuance and sale of $900.0 million aggregate principal amount of 5.625% senior notes due 2024 (the
Notes). The Notes were issued pursuant to an Indenture, dated July 27, 2016 (the Indenture), by and among the Escrow Issuer, as issuer, and Wells Fargo Bank, National Association, as trustee (the Trustee).
The Escrow Issuer, which was created solely to issue the notes, has deposited the gross proceeds of the offering into a segregated escrow account until the date that certain escrow release conditions are satisfied. Prior to the consummation of the
Merger (as defined herein), the Notes will be secured by a first-priority security interest in the escrow account and all deposits and investment property therein.
Among other things, the escrow release conditions include the consummation of the closing of the merger (the Merger) of the
Company and Media General, Inc. (Media General) pursuant to an Agreement and Plan of Merger, dated as of January 27, 2016 (the Merger Agreement), and the assumption by Nexstar Broadcasting, Inc. (NBI) of all
of the obligations of the Escrow Issuer under the Notes. Upon the release of the proceeds of the Notes from escrow (the Escrow Release Date), the Notes will be guaranteed by the Company, Mission Broadcasting, Inc. (Mission)
and certain of NBIs and Missions future restricted subsidiaries on a senior unsecured basis. If the Merger is not consummated on or prior to April 27, 2017, the Notes will be redeemed by a special mandatory redemption. The special
mandatory redemption price will be equal to 100% of the initial issue price of the Notes, plus accrued and unpaid interest, if any, from the issue date of the Notes, up to, but not including, the date of such special mandatory redemption.
As used herein, the term Issuer refers to the Escrow Issuer prior to the Escrow Release Date and NBI after the Escrow Release
Date.
The Notes were issued in a private offering that was exempt from the registration requirements of the Securities Act of 1933, as
amended (the Securities Act), to qualified institutional buyers in accordance with Rule 144A and to persons outside of the United States pursuant to Regulation S under the Securities Act. The Notes were issued at par. The Escrow Issuer
will use the net proceeds of the offering to finance a portion of the cash consideration of the Merger.
The Notes are the Issuers
senior obligations, rank equal in right of payment with all of the Issuers existing and future senior indebtedness and rank senior in right of payment to all of the Issuers future subordinated indebtedness. The Notes and the guarantees
are effectively junior to the Issuers secured indebtedness.
The Notes will mature on August 1, 2024. Interest on the Notes
accrues at a rate of 5.625% per annum and is payable semiannually in arrears on February 1 and August 1 of each year, commencing on February 1, 2017. The Issuer is obligated to make each interest payment to the holders of record
of the Notes on the immediately preceding February 1 and August 1.
The Issuer has the option to redeem all or a portion of the
Notes at any time prior to August 1, 2019 at a price equal to 100% of the principal amount of the Notes redeemed plus accrued and unpaid interest to the redemption date plus a make-whole premium. At any time on or after
August 1, 2019, the Issuer may redeem the Notes, in whole or in part, at the redemption prices set forth in the Indenture. At any time before August 1, 2019, the Issuer may also redeem up to 40% of the aggregate principal amount of the
Notes at a redemption price of 105.625% of the principal amount, plus accrued and unpaid interest, if any, to the date of redemption, with the proceeds of certain equity offerings. Additionally, within 90 days following the Escrow Release Date (as
defined in the Indenture), the Issuer will be required to (a) redeem the Notes, (b) permanently reduce outstanding term loans or (c) redeem NBIs existing 6.875% Senior Notes due 2020, in each case, in an aggregate principal
amount equal to the principal amount of Media Generals 6.125% Senior Notes due 2022 that remain outstanding following any change of control offer related thereto at a redemption price equal to 100% of the principal amount of such Notes plus
accrued and unpaid interest, if any, to the redemption date.
Upon the occurrence of a Change of Control Repurchase Event (as defined in
the Indenture), each holder of the Notes may require the Issuer to repurchase all or a portion of the Notes in cash at a price equal to 101% of the aggregate principal amount of the Notes to be repurchased, plus accrued and unpaid interest, if any,
thereon to the date of repurchase.
The Indenture contains covenants that limit, among other things, the Issuers ability to
(1) incur additional debt, (2) pay dividends or make other distributions or repurchases or redeem its capital stock, (3) make certain investments, (4) create liens, (5) merge or consolidate with another person or
transfer or sell assets, (6) enter into restrictions affecting the ability of the Issuers restricted subsidiaries to make distributions, loans or advances to it or other restricted subsidiaries; prepay redeem or repurchase certain
indebtedness and (7) engage in transactions with affiliates. These covenants are subject to a number of important exceptions and qualifications.
The Indenture provides for customary events of default (subject in certain cases to customary
grace and cure periods), which include nonpayment, breach of covenants in the Indenture, payment defaults or acceleration of other indebtedness, a failure to pay certain judgments and certain events of bankruptcy and insolvency. Generally, if an
event of default occurs, the Trustee or holders of at least 25% in principal amount of the then-outstanding Notes may declare the principal of and accrued but unpaid interest, including additional interest, on all the Notes to be due and payable.
The foregoing description of the Indenture is qualified in its entirety by reference to the complete copy of that agreement that is filed
as Exhibit 4.1 to this Current Report on Form 8-K and is incorporated by reference herein. The related form of senior note is filed as Exhibit 4.2 to this Current Report on Form 8-K and is incorporated by reference herein.
On July 27, 2016, Nexstar Broadcasting Group, Inc. issued a press release announcing the closing of the offering described herein.